NBC Cancels iTunes TV Show Deal

And Apple Responds By Not Airing Fall Shows

SAN FRANCISCO (AdAge.com) -- NBC Universal won't renew its agreement with Apple's iTunes to carry NBC shows on the download service, sparking retail retaliation from the computer giant.
Although episodes of 'The Office' will be available through December, Apple has announced that none of NBC's new fall seasons will be sold through iTunes. Credit: NBC
NBC Universal won't pull its existing content from iTunes until its current two-year deal expires in December. But in response to NBC Universal's decision, Apple today said it would not make NBC's new fall TV shows available for download from iTunes.

Top-selling shows
It's a blow to both Apple and consumers. According to Apple, NBC supplied iTunes with three of its 10 best-selling TV shows last season, accounting for 30% of iTunes' TV show sales.

NBC Universal's decision comes as the media giant prepares to launch its own online video venture in partnership with News Corp. Dubbed Hulu, the joint venture is slated to go live this fall with TV shows from Fox, NBC and others.

NBC Universal's move also suggests that media companies will increasingly want to control the distribution of their content in the digital age, rather than solely rely on online stores, such as iTunes.

Wholesale price
Apple said NBC Universal's decision came after Apple declined to pay more than double the wholesale price for each NBC TV episode, claiming such a move would have resulted in the retail price to consumers increasing to $4.99 per episode from the current $1.99.

While NBC was not the first network to ink a deal with iTunes, it's been one of the most successful. The popularity of iTunes downloads of "The Office" played a role in driving on-air ratings for that show.